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A renewable portfolio standard (RPS) is a regulation that requires the increased production of energy from renewable energy sources, such as wind, solar, biomass, and geothermal. Another common name for the same concept is renewable electricity standard (RES).

The RPS mechanism generally places an obligation on electricity supply companies to produce a specified fraction of their electricity from renewable energy sources. Certified renewable energy generators earn certificates for every unit of electricity they produce and can sell these along with their electricity to supply companies. Supply companies then pass the certificates to some form of regulatory body to demonstrate their compliance with their regulatory obligations. Because it is a market mandate, the RPS relies almost entirely on the private market for its implementation. Those supporting the adoption of RPS mechanisms claim that market implementation will result in competition, efficiency and innovation that will deliver renewable energy at the lowest possible cost, allowing renewable energy to compete with cheaper fossil fuel energy sources.[1]

RPS-type mechanisms have been adopted in Britain, Italy and Belgium,[citation needed]as well as in 27 U.S. states, Chile and the District of Columbia. Regulations vary from state to state, and there is no federal policy. Four of the 27 states have voluntary rather than mandatory goals. Together these 27 states account for more than 42 percent of the electricity sales in the United States.[2]

It is worth noting that RPS mechanisms have tended to be most successful in stimulating new renewable energy capacity in the United States where they have been used in combination with federal Production Tax Credits (PTC). In periods, where PTC have been withdrawn the RPS alone has often proven to be insufficient stimulus to incentivise large volumes of capacity.[citation needed]

The Edison Electric Institute, a trade association for America’s investor-owned utilities, has taken a stand against a nationwide RPS, saying it would “raise consumers’ electricity prices and create inequities among states.”[3]

In 2009, the US Congress has been considering Federal level RPS requirements. The "American Clean Energy Leadership Act" reported out of committee in July by the Senate Committee on Energy & Natural Resources includes a Renewable Electricity Standard that calls for 3% of U.S. electrical generation to come from non-hydro renewables by 2011–2013.[4]


Program diversity

Of all the state-based RPS programs in place today, no two are the same. Each has been designed taking into account state-specific policy objectives (e.g. economic growth, diversity of energy supply, environmental concerns), local resource endowment, and the capacity to expand renewable energy production. At the most basic level, this gives rise to differing RPS targets and years (e.g. Arizona's 15% by 2025 and Colorado's 20% by 2020). Looking at these two values alone can however be misleading. Other factors in program design include resource eligibility, in-state requirements, new build requirements, technology favoritism, cost caps, program coverage (IOUs versus Cooperatives and Municipal utilities), cost recovery by utilities, penalties for non-compliance, rules regarding REC creation and trading, and additional non-binding goals.[5]

List of US states

State Amount Year Notes
Arizona 15% 2025
California 33% 2020
Colorado 30% 2020
Connecticut 23% 2020
District of Columbia 11% 2022
Delaware 20% 2019
Florida 20% 2020
Hawaii 10%[6] 2010
Iowa 105 MW
Illinois 25% 2025
Kansas 20% 2020 10% by 2010, 15% by 2019
Massachusetts 20% 2025 Rises by 1% per year until revised by the legislature.
Maryland 9.5% 2022
Maine 10% (new renewable resources; existing RPS is 30% and has been since 2000) 2017 (increasing 1% every year for 10 years, until reaching 10% by 2017)
Michigan 10% 2015
Minnesota 25% 2025
Missouri 11% 2020 Voluntary
Montana 15% 2015
New Hampshire 23.8% 2025
New Jersey 22.5% 2021
New Mexico 20% 2020
Nevada 20% 2015 5% solar
New York 24% 2013
North Carolina 12.5% 2021
Ohio 12.5% 2025 Additional 12.5% from alternative sources
Oregon 25% 2025
Pennsylvania 18% 2020 0.5% solar
Rhode Island 15% 2020
Texas 5,880 MW 2015
Utah 20% 2025 Voluntary
Vermont 10% 2013 Voluntary
Virginia 12% 2022 Voluntary
Washington 15% 2020
West Virginia 25% 2025
Wisconsin 10% 2015


The California Renewables Portfolio Standard was created in 2002 under Senate Bill 1078 and further accelerated in 2006 under Senate Bill 107. The bills stipulate that California electricity corporations must expand their renewable portfolio by 1% each year until reaching 20% in 2010. On November 17, 2008, Governor Arnold Schwarzenegger signed executive order S-14-08 which mandated a RPS of 33% by 2020 which sits in addition to the 20% by 2010 order.[7]


The Colorado Renewable Portfolio Standard was updated from 20% to 30% in the 2010 Legislative Session as House Bill 1001. This increase is anticipated to increase solar industry jobs from current (2009) estimated 2,500 to 33,500 by 2020. The updated RPS is also anticipated to create an additional $4.3B (U.S.) in state revenue within the industries.[8]


In 1997 Nevada passed a Renewable Portfolio Standard as part of their 1997 Electric Restructuring Legislation (AB 366) It required any electric providers in the state to acquire actual renewable electric generation or purchase renewable energy credits so that each utility had 1 percent of total consumption in renewables. However, on June 8, 2001, Nevada Governor Kenny Guinn signed SB 372, at the time the country's most aggressive renewable portfolio standard. The law requires that 15 percent of all electricity generated in Nevada be derived from new renewables by the year 2013.[9]

The Nevada RPS includes double goal. The 2001 revision requires that at least 5 percent of the renewable energy projects must generate electricity from solar energy.[9]

In June 2005, the Nevada legislature passed a bill during a special legislative session that modified the Nevada RPS (Assembly Bill 03). The bill extends the deadline and raised the requirements of the RPS to 20 percent of sales by 2015.[9]

On Friday January 9, 2009 the Florida Public Service Commission unanimously agreed to require the state's utilities to generate 20 percent of their power from renewable resources by 2020.
This will drastically change the landscape for renewable energy applications for a state that gets less than 3 percent of its power from renewable energy. The proposal calls for 7 percent renewable energy by January 2013, 12 percent by 2016, 18 percent by 2019 and 20 percent by end of 2020.


In an April 2008 unanimous vote, the Ohio legislature passed a bill requiring 25 percent of Ohio's energy to be generated from alternative and renewable sources, of which half or 12.5 percent must derive from renewable sources.[10]


Pennsylvania requires that 18 percent of all energy generated in the state come from alternative and renewable sources by 2021, including 0.5 percent from solar.[11]


The Texas Renewable Portfolio Standard was originally created by Senate Bill 7 in 1999. The Texas RPS mandated that utility companies jointly create 2000 new MWs of renewables by 2009 based on their market share. In 2005, Senate Bill 20, increased the state’s RPS requirement to 5,880 MW by 2015, of which, 500 MW must come from non-wind resources. The bill set a goal of 10,000 MW of renewable energy capacity for 2025.[12]

See also


External links


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